First Auctioned Nuke Changes Hands
Entergy Nuclear grew its nuclear fleet with the first U.S.
competitive bid purchase of a nuclear plant. Entergy bought Pilgrim
Station, a 670-megawatt reactor in Plymouth, MA, from Boston Edison
for $81 million. The deal closed less than eight months after the
companies agreed to transfer ownership.
"Pilgrim is the first of many plants we plan to acquire," said
Don Hintz, president of Entergy Corp. "We intend to be a major
player in the new market with a large portfolio of well-run,
competitive nuclear units. This sale is a good first step toward
achieving that goal."
"The sale of Pilgrim to a company that owns and operates a
larger fleet of nuclear generating units helps ensure that safe,
reliable, and economical electricity will continue to be provided
to the northeast," said Tom May, Boston Edison CEO.
The competitive bid process is considered to be a model for the
nuclear industry. Entergy will pay Boston Edison $81 million for
Pilgrim Station, the nuclear fuel, and the plant's 1,600-acre site
on Cape Cod Bay. In addition, credits of up to $31 million
potentially available on future nuclear insurance premiums would be
transferred from Entergy to Boston Edison. The sale includes power
purchase agreements through 2004. Boston Edison will fully fund the
plant's decommissioning trust with $471 million. Entergy expects to
realize a $0.05/share earnings contribution to 1999 earnings from
"This marks the first completed sale in the history of the
industry," said Jerry Yelverton, CEO of Entergy's nuclear
Entergy Nuclear is a non-regulated subsidiary of Entergy Corp.,
a New Orleans-based global energy company that distributes energy
to 2.5 million customers.
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